Requires the owner or operator of a major facility or a vessel to establish and maintain with the department evidence of financial responsibility sufficient to meet the amount of liability.
NEW YORK STATE ASSEMBLY MEMORANDUM IN SUPPORT OF LEGISLATION submitted in accordance with Assembly Rule III, Sec 1(f)
BILL NUMBER: A9213
SPONSOR: Fahy TITLE OF BILL:
An act to amend the navigation law, in relation to financial responsi-
bility for the liability of a major facility or vessel
PURPOSE OR GENERAL IDEA OF BILL:
To require the owner or operator of a major facility or a vessel to
establish and maintain with the department evidence of financial respon-
sibility sufficient to meet the amount of liability.
SUMMARY OF SPECIFIC PROVISIONS:
Section 1: amends paragraph (e) of subdivision 3 of section 181 of the
navigation law and adds a new paragraph (f).
Section 2: amends the navigation law by adding a new section 181-f to
require railroad financial preparedness, and requires the department to
make that information on its public website.
Section 3: effective date
JUSTIFICATION:
The Petroleum Storage Surety bill is in response to recent accidents
resulting in substantial financial losses to both public and private
entities due to injuries, loss of life, damages and clean-up costs, all
as a result of explosions and spills from improper handling of volatile
and toxic crude oil shipments. This bill would apply to crude oil stored
and transferred at all bulk storage facilities, vessels, and railroads
in New York State, and require financial security to meet all responsi-
bilities for clean-up and decontamination costs associated with the
release of such oil up to existing federal and state liability limits.
The transport of crude oil by rail has increased exponentially nation-
wide in recent years, from over 9,000 carloads of crude oil in 2008 to
over 400,000 in 2013, and the need for storage facilities has expanded
accordingly. There is a heightened awareness of safety issues related to
the transportation and storage of crude oil and the Petroleum Surety
bill is one attempt to address the negative impacts of mishandling and
improper storage of crude oil. Rail transportation of crude oil is regu-
lated by federal law whereas bulk storage of crude oil is governed by
state law.
It is necessary that financial surety measures be put in place to ensure
that the public is not burdened with the high costs resulting from crude
oil accidents. This may include evidence of insurance, a letter of cred-
it, or a bond from a corporate surety licensed to do business in New
York State.
The Petroleum Storage Surety bill will ensure that any bulk petroleum
storage facility, vessel, and railroad has the necessary financial secu-
rity to balance the risk of any accident occurring that is directly
related to storing crude oil.
PRIOR LEGISLATIVE HISTORY:
2017/18: A1773/S1515 - Passed Assembly
2015/16: A7625/55751-A - Passed Assembly
FISCAL IMPLICATIONS:
None to the state
EFFECTIVE DATE:
This act shall take effect on the one hundred twentieth day after it
shall have become a law.
